On January 1, 2018, Tape Enterprises issued 9%, 10-year bonds with a face amount of $700,000 at 96. Interest is payable annually on January 1. The bonds were issued for an effective interest rate of 10%.
Instructions
Prepare the entries to record the issuance of the bonds and the first annual interest accrual and amortization assuming that the company uses effective-interest amortization.

Question

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The Answer of On January 1, 2018, Tape Enterprises issued 9%, 10-year bonds with a face amount of $700,000 at 96. Interest is payable annually on January 1. The bonds were issued for an effective interest rate of 10%.
Instructions
Prepare the entries to record the issuance of the bonds and the first annual interest accrual and amortization assuming that the company uses effective-interest amortization.

On January 1, 2018, Tape Enterprises Issued 9%, 10-Year Bonds